implications of psychological research on economy

• The economy

  The production and consumption of goods and services.
• Psychology and the economy

  Psychological theories can be applied by governments and companies to improve how the economy functions, including:

  A psychologically healthy and well educated populate can be more productive.

  The consumption of goods and services depends on a population able and willing to buy those goods and services.

  Generation of tax revenue that pays for public services.
• Attachment and the economy


  Adoption - research by Harlow (deprivation in monkeys), Bowlby (critical period), Ainsworth (attachment type) - all demonstrate intellectual, emotional and physical development can be negatively affected by deprivation early in a child's life.
• Attachment influence on the economy - NHS


  Midwives use the psychological knowledge gained about the developmental needs of young children when giving informed advice to expectant mothers. Hospitals have improved their policies around family visiting houses and adoption agencies prioritise quick placements of infants with loving families.

  Improves the economy since it improves the development of children and are therefore more likely to be productive adults and less likely to need costly mental health support.
• Social influence and the economy


  Obedience and conformity - researchers such as Milgram (obedience) and Asch (conformity) demonstrated how situational social pressures could influence an individual's behaviour. Findings are used by organisations to change the behaviour of their citizens.
• Social influence influence on the economy


  The nudge unit working for HMRC sent letters to people who did not pay their tax and included stats showing the majority pay their tax on time. Therefore, people conform.

  This improves the economy by increasing the amount of money available for the government to spent on other services.
• Conditioning and the economy


  Behavioural theories of classical (pavlov) and operant (skinner) conditioning explains how to shape and even change behaviour.
• Conditioning influence on the economy


  Social media and computer game companies can manipulate their users to engage with their products more by providing virtual rewards such as 'likes', 'followers' and 'levels'. These act as social rewards and result in compulsive use - this improves the economy as companies like facebook can display more adverts, making more money.
• Neurotransmitters and the economy


  Drug treatments: the action and imbalance of neurotransmitters are linked to mental health conditions such as anxiety, depression, OCD and schizophrenia. Drug therapies can act on neurotransmitters, altering how they function in the brain and reducing symptoms.
• Neurotransmitters influence on the economy


  The development of cheap and effective drug treatments has allowed people to reduce symptoms and return to everyday life, including work. This improves the economy by reducing cost to the NHS, improving workers' productivity at work and increasing the number of workers paying taxes.
• Memory and the economy


  Justice system: researchers such as Loftus have shown that memory and its use in EWT in court have serious limitations. Cases that depend on EWT alone can result in miscarriages of justice due to misidentification. Police are now trained to avoid leading questions and post-event contamination. Some also use cognitive interview which is found to be more accurate.
• Memory influence on the economy


  Improves the economy by reducing the cost of imprisoning people who do not belong in prison and by imprisoning people who are guilty and may otherwise go on to commit more crimes that may be costly (e.g. fraud)